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This is why investors see too much risk in Twitter-dependent companies

It started way back in 2010 when, just before their first Chirp developer conference, Twitter shocked their developer community and ecosystem by buying a Twitter client and making some other moves that essentially put a stop on capital investment in any third-party companies that relied on the Twitter API or partnering with Twitter.

Twitter tried to assuage fears, but it never really worked. Investors have shied away from Twitter-dependent start-ups ever since, and probably for good reason. Over the past several years, Twitter has continued to show all signs that the API is a dangerous place for third parties, capriciously shutting down and blocking apps left and right (no matter their size) and steadily increasing restrictions on API policies.

I still operate a few free services that require the Twitter API. Luckily, I don’t expect those services to pay my bills and I fully expect that one day Twitter will shut them all down, for one ex post facto reason or another. Their API has become an Albatros and double-edged sword. It was what they needed to get off the ground but now they wish it were gone. It’s also a catch-22: the service isn’t good enough that they can charge for it, but it costs Twitter too much to give it away for free.